Trump White House says it's losing $19B-$26B a year in revenue as countries dodge tariffs

WASHINGTON (AP) — The Trump White House said in a new report on Thursday that countries are routing their exports through third countries to avoid U.S. tariffs, estimating that there are tax revenue losses of $19 billion to $26 billion annually.

The report specifically highlights that China responded to new tariffs in 2018 by sending their goods to other nations ranging from Mexico to Malaysia for packaging and limited assembly — a practice known as transshipping. That pattern made it look like U.S. imports from China had dropped, but enabled Beijing to continue growing its manufacturing sector in ways that could challenge U.S. factories and employment.

Peter Navarro, the White House trade adviser, told reporters on a conference call that China is laundering its exports through more than 40 countries, though he claimed that the issues raised in the report were really more about other nations enabling the avoidance of tariffs.

“For years, the great transshipment scam has let communist China launder its exports,” Navarro said.

The report comes ahead of a planned September visit by Chinese Leader Xi Jinping, who President Donald Trump described in flattering terms during his own visit to Beijing in May.

The Chinese government has described its relationship with the U.S. as one of “strategic stability,” yet its government policies that support exports of manufactured goods have destabilized the auto, metals and electronics sectors in America, Europe, Japan and elsewhere.

Navarro said that other nations such as India could also transship to avoid new tariffs and said that new trade frameworks pursued by the Trump administration are going to contain provisions that ensure trade partners that engage in the practice will be penalized.

The Trump administration has levied high tariffs on much of the world in hopes of protecting U.S. manufacturers, hitting allies and rivals alike with import taxes. At the same time, those tariffs have created new inflationary pressures at home.

The report includes a range of estimates for the scale of transshipments to avoid tariffs, citing government and private sector numbers to estimate roughly $34.2 billion to $303 billion of goods transshipped each year. It used a central figure of $75 billion worth of goods being transshipped to estimate how much in tax revenues have been lost.

To address the challenge, Navarro said that U.S. Customs and Border Protection has started to use artificial intelligence in a prototype program to stop transshipments. Navarro said that when an importer has been found to have falsified the origins of a good, its imports can be retroactively tariffed going back roughly a year.

The president’s tariffs during his second term have faced an array of legal challenges, with the Supreme Court overturning some of them in February. America continues to import more than it exports to the rest of the world, but the trade imbalance so far this year at $371 billion is running about $189 billion lower that it did during the same period last year.

White House trade counselor Peter Navarro speaks with reporters following a video interview with Real America's Voice News, Tuesday, Aug. 11, 2026, outside the White House in Washington. (AP Photo/Julia Demaree Nikhinson)

WASHINGTON (AP) — U.S. applications for unemployment benefits rose last week, but layoffs remain at historically healthy levels.

The Labor Department reported Thursday that 209,000 people filed jobless claims last week, up from a revised 200,000 the week before and higher than the 205,000 forecasters had expected. The four-week average of applications, which smooths out week-to-week volatility, was unchanged at 199,000.

The overall number of people collecting employment benefits the week that ended Aug. 1 dropped by 22,000 to 1.78 million.

Claims for jobless benefits are a proxy for layoffs, and they've been at a historically low range of around 200,000 to 230,000 a week for the past year, suggesting that Americans who have jobs enjoy unusual job security. The U.S. unemployment rate is low at 4.1%, as the economy has proven resilient despite a spike in energy prices caused by the fighting with Iran.

"The labor market has yet to show any sign of wear and tear from the surge in oil prices since the start of the war with Iran and the global energy supply shock,'' Carl Weinberg, chief economist at High Frequency Economics, wrote in a commentary.

The story is less encouraging for those trying to break into the job market and for those who lost their jobs and are looking for new work. Companies, scarred by worker shortages that followed the end of COVID-19 lockups four to five years ago, are reluctant to let go of staff; but they aren't eager to take on new workers. Economists regularly refer to a "no hire, no fire'' job market.

Last month, in fact, companies, government agencies and nonprofits together cut 23,000 jobs instead of increasing them, the Labor Department reported last week. So far this year, employers are adding 61,000 jobs a month. That is an improvement on the 9,700 they averaged last year — the weakest hiring outside a recession since 2002. The lingering effects of high interest rates and President Donald Trump's erratic trade policies discouraged companies from hiring in 2025.

Still, hiring this year remains well below the 166,00 monthly jobs created, on average, in 2023 and 2024, let alone the 491,000 a month recorded during the 2021-2022 hiring boom that followed pandemic lockdowns.

FILE - Hiring sign for sales professionals is displayed at a store, in Vernon Hills, Ill., Wednesday, April 15, 2026. (AP Photo/Nam Y. Huh, file)